{{citations needed|date=June 2022}} {{Short description|Investment management and financial planning service}} {{Banking|banks}} [[File:Asset Allocation.pdf|thumb|right|250px|Modern portfolio theory suggests a diversified portfolio of shares and other asset classes (such as debt in corporate bonds, treasury bonds, or money market funds) will realise more predictable returns if there is prudent market regulation.]] '''Wealth management''' ('''WM''') or '''wealth management advisory''' ('''WMA''') is an investment advisory service that provides financial management and wealth advisory services to a wide array of clients ranging from affluent to high-net-worth (HNW) and ultra-high-net-worth (UHNW) individuals and families.<ref>{{Cite journal |last=Shiffer-Sebba |first=Doron |date=2025 |title=Keeping the Family Fortune: How Bureaucratic Practices Preserve Elite Multigenerational Wealth |url=https://journals.sagepub.com/doi/abs/10.1177/00031224251319001 |journal=American Sociological Review |language=en |article-number=00031224251319001 |doi=10.1177/00031224251319001 |issn=0003-1224|url-access=subscription }}</ref>
It is a discipline that involves structuring and planning wealth to help grow, preserve, and protect it, while also passing it on to the family in a tax-efficient manner and in accordance with their wishes. Wealth management brings together tax planning, wealth protection, estate planning, succession planning, and family governance.
==Private wealth management== High-net-worth investors seek private wealth management. Generally, this includes advice on the use of various estate-planning vehicles, business succession or stock-option planning, and the occasional use of hedging derivatives for large blocks of stock. thumb|260px|A wealth management consultation Traditionally, the wealthiest retail clients of investment firms demanded a higher level of service, product offerings, and sales personnel than average clients received. With an increase in the number of affluent investors in recent years,<ref>David Teather. [https://www.theguardian.com/business/2008/jun/25/richlists.globaleconomy Richlists]. ''The Guardian''. 25 June 2008.</ref> there has been an increasing demand for sophisticated financial solutions and expertise throughout the world.
The CFA Institute curriculum on private-wealth management indicates that two primary factors distinguish the issues facing individual investors from those facing institutions:
# Time horizons differ. Individuals face a finite life as compared to the theoretically/potentially infinite life of institutions. This fact requires strategies for transferring assets at the end of an individual's life. These transfers are subject to laws and regulations that vary by locality, and therefore, the strategies available to address this situation vary. This is commonly known as accumulation and decumulation. # Individuals are more likely to face a variety of taxes on investment returns that vary by locality. Portfolio investment techniques that provide individuals with after tax returns that meet their objectives must address such taxes.
The term "wealth management" first appeared as early as 1933.<ref>{{cite book | last = Fowler | first = William Franklin | title = Fishermen and fish: A sequel to For America, an interpretation and plan | url = https://books.google.com/books?id=J5vXAAAAMAAJ | access-date = 2013-01-30 | year = 1933 | publisher = W.F. Fowler | location = Lynbrook, N.Y | page = 38 | quote = To the inefficiency of political control of government, which is the principal cause of unsound conditions, they would grant the additional authority and responsibility of wealth management. }}</ref> It came into more general use in the elite retail (or "Private Client") divisions of firms such as Goldman Sachs or Morgan Stanley (before the Dean Witter Reynolds merger of 1997), to distinguish those divisions' services from mass-market offerings, but has since spread throughout the financial-services industry. Family offices that had formerly served just one family opened their doors to other families, and the term "multi-family office" was coined. Accounting firms and investment advisory boutiques also created multi-family offices.
Certain larger firms (UBS, Morgan Stanley and Merrill Lynch) have "tiered" their platforms – with separate branch systems and advisor-training programs, distinguishing "Private Wealth Management" from "Wealth Management." The latter term denotes the same type of services but with a lower degree of customization and delivered to mass affluent clients. At Morgan Stanley, the "Private Wealth Management" retail division focuses on serving clients with more than $20 million in investment assets. In comparison, "Global Wealth Management" focuses on accounts under $10 million.
In the late 1980s, private banks and brokerage firms began offering seminars and client events to showcase the sponsoring firm's expertise and capabilities. Within a few years, new business models emerged – Family Office Exchange in 1990, the Institute for Private Investors in 1991, and CCC Alliance in 1995. These companies aimed to offer an online community and a network of peers for ultra high-net-worth individuals and their families. These entities have grown since the 1990s, with total IT spending (for example) by the global wealth management industry predicted to reach $35bn by 2016, including heavy investment in digital channels.<ref name=":0">[http://ovum.com/research/wealth-management-technology-spending-through-2016-business-function-segmentation/ Wealth Management Technology Spending Through 2016 (July 2012)] </ref>
Wealth management can be provided by large corporate entities, independent financial advisers, or multi-licensed portfolio managers who design services focused on high-net-worth clients. Large banks and large brokerage houses develop segmented marketing strategies to sell both proprietary and non-proprietary products and services to investors identified as potential high-net-worth clients. Independent wealth managers use their expertise in estate planning and risk management, along with their affiliations with tax and legal specialists, to manage the diverse holdings of such clients. Banks and brokerage firms also use advisory talent pools to aggregate and deliver these services.
The Great Recession of the late 2000s caused investors to address concerns within their portfolios.<ref> Yeh, C: "Investors Challenge Market 'Truths'", CFA Institute Private Wealth Management, August 2009. </ref> For this reason, wealth managers have been advised that clients have a greater need to understand, access, and communicate with advisers about their situation.<ref> Costa, L: "Questions Replace Investment 'Truths': A Comment", CFA Institute Private Wealth Management, May 2009. Quote: "This state of affairs poses a dilemma for wealth managers, who, for a generation, have adhered to the core principles of asset allocation and earned their keep by preaching the mantras of 'buy and hold', 'invest for the long term', and when things get tough, 'stay the course'."</ref>
==Life goals== {{anchor|Financial life management}}<!-- Merged per Wikipedia:Articles for deletion/Financial life management --> As awareness of wealth management has become more common, some companies have shifted towards a model that asks clients about life goals,<ref>{{cite web |title=How can "goals-based" wealth management prepare me for different life stages? - Worth |url=https://www.worth.com/how-can-goals-based-wealth-management-prepare-me-for-different-life-stages/ |website=Worth}}</ref> working environments, and spending patterns as a way to increase communication.<ref name=nyt/> The industry-recognized wealth management was more than an investment advisory discipline.<ref>Welch, Scott, "Perspectives on Serving the Ultra-High-Net Space An Interview with Jean L.P. Brunel and Charlotte Beyer" IMCA Wealth Management Monitor, Jan/Feb 2016</ref><ref>{{cite web |title=Total Wealth Management |url=https://www.evelyn.com/total-wealth-management/ |website=evelyn.com |publisher=Evelyn Partners |access-date=22 October 2025}}</ref> In 2015, United Capital rebranded its wealth management services as "financial life management", which, according to the company, was intended to more clearly distinguish wealth management companies from more affordable brokerage firms.<ref>{{cite web| url=http://www.thinkadvisor.com/2015/03/25/united-capitals-duran-wealth-management-is-dead-lo|author = Gil Weinreich| title= United Capital's Duran: Wealth management is dead. Long live life management!|date = March 25, 2015|work=ThinkAdvisor|publisher= ALM| access-date= September 17, 2015}}</ref> The same year Merrill Lynch began a program, Merrill Lynch Clear, which asks investors to describe life goals, and includes an educational program for clients' children.<ref name=nyt>{{cite news| url=https://www.nytimes.com/2015/03/21/your-money/financial-advisers-seek-to-inject-a-more-human-element.html|last= Sullivan|first=Paul| title= Financial advisers seek to inject a more human element|date = March 20, 2015|work= The New York Times| access-date= September 17, 2015}}</ref> For clients looking to leverage their wealth for the sake of achieving philanthropical and charitable goals, social finance investments may be included.
== Private banking and wealth management rankings ==
According to Euromoney's annual Private banking and wealth management ranking 2013, which consider (amongst other factors) assets under management, net income and net new assets, global private banking assets under management grew just 10.8%YoY (compared with 16.7% ten years ago).<ref>[http://www.euromoney.com/Article/3151553/Euromoney-publishes-10th-annual-Global-Private-Banking-SurveyUBS-returns-to-the-top.html Annual private banking industry assets under management]</ref>
The largest private banks and wealth managers in the world as of 2018 are as follows:<ref name="o719">{{cite web | title=Euromoney publishes 10th annual Global Private Banking Survey – UBS returns to the top | website=Euromoney | date=6 February 2013 | url=https://www.euromoney.com/article/b12kjwrh63789s/euromoney-publishes-10th-annual-global-private-banking-survey-ubs-returns-to-the-top | access-date=10 January 2025}}</ref> {| class="wikitable sortable" |- ! Rank ! Company ! Headquarter ! Assets under management |- | style="text-align:right" | 1 | UBS | {{flag|Switzerland}} | style="text-align:right" |$2,403 billion |- | style="text-align:right" | 2 |Bank of America Merrill Lynch | {{flag|United States}} | style="text-align:right" | $1,080 billion |- | style="text-align:right" | 3 |Morgan Stanley | {{flag|United States}} | style="text-align:right" | $1,045 billion |- | style="text-align:right" | 4 |Credit Suisse | {{flag|Switzerland}} | style="text-align:right" | $792 billion |- | style="text-align:right" | 5 |J.P.Morgan Private Bank | {{flag|United States}} | style="text-align:right" | $526 billion |- | style="text-align:right" | 6 |Citi Private Bank | {{flag|United States}} | style="text-align:right" | $460 billion |- | style="text-align:right" | 7 |BNP Paribas | {{flag|France}} | style="text-align:right" | $436.7 billion |- | style="text-align:right" | 8 |Goldman Sachs | {{flag|United States}} | style="text-align:right" | $394.3 billion |- | style="text-align:right" | 9 |Julius Baer | {{flag|Switzerland}} | style="text-align:right" | $388.3 billion |- | style="text-align:right" | 10 |China Merchants Bank | {{flag|China}} | style="text-align:right" | $292.8 billion |}
==See also== *Multi-family office * Private banking * Robo-advisor
==References== {{Reflist}}
==Further reading== *Spear's Wealth Management Survey, {{cite web |title=Spear's Magazine |url=https://www.spearswms.com/ |website=Spear's Magazine}} *{{cite book|last1=Harrington|first1=Brooke|title=Capital Without Borders: Wealth Managers and the One Percent|date=2016|publisher=Harvard University Press|location=Cambridge, Massachusetts|isbn=978-0-674-74380-9|oclc=944339474}} * {{Cite book|title=The Purposeful Wealth Advisor: How to Build a Rewarding Career While Helping Clients Achieve Their Dreams|last=Sharma|first=Raj|last2=jSieg|first2=Andy|publisher=Amplify Publishing|year=2022|location=Herndon, VA|isbn=978-1-63755-548-4|oclc=1370903083}}
==External links== * [http://www.occ.gov/publications/publications-by-type/comptrollers-handbook/invmgt.pdf Investment Management U.S. Treasury Handbook] {{wikidata-inline}} {{Wealth}}
{{DEFAULTSORT:Wealth Management}} Category:Stock market Category:Investment management Category:Financial services occupations Category:Financial management